Insurance Companies 保險公司

Authorized Insurers 獲授權保險人

Anyone who carries on insurance business in or from Hong Kong must first be authorized by the Insurance Authority (IA) under the Insurance Ordinance (Cap. 41). Carrying on insurance business without authorization is a criminal offence.

An authorized insurer may be a company incorporated in Hong Kong, or a company incorporated overseas that operates through a branch in Hong Kong. Hong Kong has a large number of authorized insurers, many of them from overseas, which reflects its position as an international insurance centre.

The IA keeps a public register of authorized insurers. Before buying a policy, members of the public can check the register to confirm that a company is authorized and which kind of business it is authorized to carry on.

Long Term, General and Composite Insurers 長期業務、一般業務與綜合保險人

The Insurance Ordinance divides insurance business into two main categories, long term business and general business, and each is further divided into classes. An insurer may carry on only the classes it is authorized for.

Long term business mainly covers life and annuity, linked long term insurance (such as investment-linked assurance), permanent health and retirement scheme management. These contracts run for many years and often have a savings or investment element.

General business covers accident and sickness, fire and property damage, motor, ships, goods in transit, general liability (including employees' compensation) and so on. These policies usually run for a short period, normally one year, and can be renewed at expiry.

An insurer that carries on both long term and general business is called a composite insurer. A composite insurer must keep the accounts and assets of its long term business separate from its general business, to protect long term policyholders. The Insurance Ordinance generally does not allow a new insurer to be authorized for both categories (with only limited exceptions), so most composite insurers in the market are long-established companies.

Direct Insurers, Professional Reinsurers and Captive Insurers 直接保險人、專業再保險人與專屬自保保險人

A direct insurer issues policies directly to members of the public or to businesses and accepts the policyholders' risks. Many direct insurers also accept reinsurance business passed on by other insurers.

A professional reinsurer carries on reinsurance business only. It accepts risks passed on by other insurers (ceding companies) and does not issue policies directly to the public.

A captive insurer is an insurance company set up and owned by a group of companies that is not itself in the insurance business, and its business is restricted to insuring the risks of companies in the same group. This helps the group manage its own risks and insurance costs. Because no members of the public hold its policies, a captive insurer faces lighter regulatory requirements (such as a lower minimum capital) than an ordinary insurer.

Forms of Ownership and Lloyd's 擁有形式及勞合社

Most insurance companies are proprietary companies owned by shareholders. The shareholders provide the capital and bear the risk, and profits are distributed to them as dividends.

A mutual insurer is owned by its policyholders and has no outside shareholders. Any surplus belongs to the policyholders and is returned to them, for example as bonuses or reduced premiums.

Lloyd's is not itself an insurance company but an insurance market, in which members grouped into syndicates underwrite the risks. The Insurance Ordinance has special provisions for Lloyd's, and Lloyd's underwriters may carry on insurance business in Hong Kong.